High bid may not secure Wilson Center

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The conservator for the August Wilson Center for African American Culture may have a fight on her hands if she tries to sell the troubled venue to the developer with the highest bid.

Pittsburgh Mayor Bill Peduto said Friday his goal is to preserve the venue's mission as an African-American cultural center, "not to ensure that it's the most profitable plan that succeeds."

"We will not allow August Wilson's name nor the center to be lost so that creditors can be made whole," he said.

Mr. Peduto was responding to an interim report released Thursday by court-appointed conservator Judith Fitzgerald detailing the four bids received for the sale of the troubled Downtown center, which is in default of its $7 million mortgage.

She said she intends to pursue the highest bid -- a $9.5 million offer by an unnamed local developer who is proposing to build a hotel on top on the building while providing the August Wilson Center with free gallery, office and storage space.

The center would have use of the theater for at least 120 days a year at a nominal fee. The buyer, Ms. Fitzgerald said, also would enter into a long-term license agreement with the center that effectively would keep it intact and operating in the building.

She said the bid, in her mind, would allow the center to continue its mission by removing facility costs and debt obligations and "restoring the path to financial viability."

But Mr. Peduto isn't so sure. He appears to favor a separate $4 million bid made by the Pittsburgh Foundation, the Heinz Endowments and the Richard King Mellon Foundation, one aimed at continuing the center's mission with the creation of a new nonprofit entity.

The mayor said the foundations and government have sunk more than $30 million into the center, far surpassing the $10 million currently owed to creditors, including mortgage holder Dollar Bank.

Asked if he thought the foundations were in the best position to continue the center's mission, Mr. Peduto replied, "Foundations have made that their primary mission, and they have already given much more than the banks ever put into this."

Told that Ms. Fitzgerald, a former bankruptcy judge, is pushing the $9.5 million bid for approval, the mayor said, "Well, she's wrong, and she'll never be able to have it happen."

He said that the city's Urban Redevelopment Authority, as one of the chief creditors, "has the power to make sure their investment is done properly, and their investment is to make sure that the mission of the August Wilson Center is done first."

The decision on the sale ultimately rests with Allegheny County Common Pleas Orphans' Court Judge Lawrence O'Toole, who is overseeing the case.

Mr. Peduto said he and county Executive Rich Fitzgerald are in accord over the need to preserve the center's mission. Mr. Fitzgerald said Thursday he favors the foundations' bid because it's the only one that "keeps the mission alive."

He added he did not believe the $9.5 million offer does that. "We'll do everything we can to stop it," he said Friday.

Ms. Fitzgerald, no relation, has said she is required under state law to provide the best recovery for creditors, although she noted a secondary objective in this case is to preserve the center's mission.

But Mr. Peduto stressed he does not believe it would be in the best interests of the banks to pursue the highest bid "and lose the mission of the August Wilson Center in the process."

"[Ms. Fitzgerald] may have her own opinion, but it's not in agreement with the community or with any of the stakeholders that are involved in this. So it's now her time to come to the table and work with us," he said.

Responding to the mayor's comments Friday, Ms. Fitzgerald said, "I made the suggestion that the parties come together, and I hope with the assistance of the mayor and the county executive that that will happen."

Eric Schaffer, attorney for Dollar Bank, declined comment.

The two other bids for the $40 million center, opened in 2009 and named after the Pulitzer Prize winning playwright who grew up in the Hill District, came from commercial enterprises that would purchase the building and the liquor license for $4.5 million and $3.25 million, respectively.

Mark Belko: mbelko@post-gazette.com or 412-263-1262.

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